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Monday, August 25, 2014

CRI Interview on “some latest development of the China-Japan relations”

Just recorded an interview for
China Radio International. Went mostly according to my CliffsNotes below. Did
very little improvising (which I am not good at). Let’s see if they use it all,
or edit it.

1. Up to date Xi Jinping and Shinzo Abe have
not held any face-to-face talk since they took office. However, the Japanese
media Nikkei Business Daily reported earlier this month that Japan and China
are trying to arrange two-way talks between their leaders at this year’s APEC
Summit in November in Beijing. It might be difficult to verify this, but do you
sense any positive changes in bilateral ties?

Yes,
I am seeing improvements. Two events. First, in May, Masahiko Komura visited
Beijin. He met Zhang Dajiang, and said that he did not think that Prime
Minister Abe would visit the Yasukuni Shrine. The fact that the meeting took
place at all was important. Mr. Zhang is the Chairman of the National People’s
Congress, which makes him the third most important official in China. As for Mr.
Komura, he is one of the most important elders of the ruling Liberal Democratic
Party, outranked only by Mr. Abe himself. He served as foreign minister on two
occasions and acquitted himself well. He is clearly a moderate but enjoys Mr.
Abe’s full trust, who called on him to reel in a reluctant Komeito, the junior coalition
partner, as well as reluctant doves of his own party, to support the
reinterpretation of the Japanese constitution to allow collective self-defense.
Mr. Abe will not say that he will not go to the Yasukuni Shrine; personal conviction
and domestic politics prevents him from saying so outright. But Mr. Komura’s
comment carries great weight and was certainly closely coordinated with Mr. Abe
and his senior advisors. I am reasonably cofident that the Chinese authorities
got the message.

Second,
a couple of weeks ago, Kishida Fumio and Wong Yi had a bilateral meeting at the
ASEAN Regional Forum. The importance of this meeting is obvious; this is the
first time that the foreign ministers of the two countries met bilaterally in a
long while. Nothing substantial came of it, but that was not the point. It is
another gingerly step toward normalization of the bilateral relationship, giving
us some hope of a summit that will enable the two governments to tell their
people, move along, there’s nothing to see here. That is particularly important
for the Xi Jinping administration, which needs to focus on domestic reforms. The
islands can wait, I’m sure.

2. Former Japanese Prime Minister Yasuo
Fukuda paid a low-profile visit to China late last Month and he successfully
met with President Xi Jinping. In the eyes of Chinese, Yasuo Fukuda was a
friendly Japanese leader when he was in power. How is his trip perceived from
the Japan point of view?

People
in Japan who welcome any sign of improving bilateral relations must have
welcomed that visit, but I do not think that it moved the needle, as far as the
Abe administration was concerned. I could be wrong; I am not an insider, and if
I were, I probably would not be talking openly about this. And Mr. Fukuda is not
quite Mr. Hatoyama, who has also visited Beijing with much less success. But
Mr. Fukuda is clearly a dove; Mr. Abe obviously is not. Mr. Fukuda is also
retired as a politician, which further diminishes the impact. I think that it
was good in the sense that it sent the message to the Chinese public that the
Chinese leadership had nothing against Japan itself, or even the Liberal Democratic
Party. Such gestures help contain the negative fallout if and when there are
incidents down the road.

3. In public Shinzo Abe is calling for
“frank and open discussions” with China. On the other hand, however, the Abe
government seems to make no concessions on island disputes in East China Sea.
How is Abe’s China policy interpreted from the Japanese perspective? Do people
in Japan hold a more critical view or supportive view towards his China policy?

The
overwhelming majority of the Japanese public support Mr. Abe on his position
regarding the Yasukuni Islands. From the Japanese perspective, it is the
Chinese authorities that are trying to change the status quo, which is not a
good precondition for concessions unless Japan is at a serious disadvantage security-wise.
I think here, the Japanese perspective is that the mutual security treaty with
the United States is very useful. And this is not just Mr. Abe. Remember, the
two incidents that made the bilateral relationship take a serious turn for the
worse occurred under administrations led by the Democratic Party of Japan, not
the Liberal Democrats. “Frank and open,” sure, but that does not necessarily
entail the possibility of “concessions.” The Japanese position is that China
should take the matter to the International Court of Justice. I don’t see that
changing any time soon.

4. Data from Japan’s foreign ministry show
the number of Japanese living in China fell more than 10 per cent in 2013. Do
you think that political distrust has a growing spill-over effect on other
aspects of China-Japan ties?

We
are certainly seeing the results of investment or disinvestment decisions made
in late 2012, early 2013, after the December riots in China that targeted
Japanese assets and products there. But the downturn in Japanese investment
reflects more general problems with regard to China. Remember, investment this
year from the United States and European Union has also fallen by double digits
year-on-year, just not as dramatically as in Japan’s case. Labor costs keep
going up, and there is a sense that non-Chinese businesses are being targeted to
their economic disadvantage. The recent crackdown on foreign auto manufacturers
and suppliers is the most obvious case from the foreign perspective. Even the McDonalds
chicken meat fiasco is seen as picking on a foreign firm. And political risk
advisors think that the trend towards favoring state-owned enterprises and
national champions will continue for the foreseeable future.

Some
of the drop in the number of Japanese living in China may be attributable to a
less amenable social context that reflects the downturn in the political
relationship, but I suspect that it is more a reflection of a combination of
maturing investments—businesses will replace expensive ex-pats with local
personnel whenever they can—and quality-of-life issues, such as pollution and
food safety. The ex-pat employees that remain are sending their families back
to Japan.

5. Amidst the deteriorating Sino-Japan
relations, economic cooperation between the world’s second and third largest
economies has been suffering. Recent data from The Japan External Trade
Organization, however, show Japan’s export to China during the first half of
this year actually had an increase for the first time over the past 3 years. At
the same time, China’s export to Japan has gone back to the level prior to the
ongoing crisis between the two countries. Why do you think the bilateral trade
is showing signs of recovery? Will the positive signs in trade pave way for the
warming-up of the bilateral relations?

It’s
simple. The Chinese economy continues to grow, the Japanese economy continues
to recover, and there is strong interdependence between the two economies. The
figures were bound to come to this sooner or later.

But
the trade figures do not pave the way for a political warming-up. In fact, if
anything, I think that it’s more the other way around; as the Chinese authorities
have taken ownership of the bilateral political and security conflict,
sidelining the Chinese public as far as participatory politics—demonstrations,
riots, boycotts and the like—this has enabled the economic side of the relationship
to take on a business-as-usual coloring.

Now,
I do not think that the Japanese public really connects the politics to the
economics. If the Japanese consumer hesitates to consume products made in
China, it is out of safety concerns, not because one finds China’s actions
around the Senkaku Islands disagreeable. It does not quite work that way the
other way around, because of how the dispute as well as the so-called history
issues play out in China’s education and media. But the Chinese authorities have
done a good job of containing the economic fallout. The real problem in China
is more general, and is not a Japan issue.

1 comment:

Most interesting, but I think you meant Senkaku Islands.This being said, moving Yasukuni to the Senkakus is a great idea:1. PM won't vist: Too far, and Japan has committed itself to not stationing government officials there.2. Chinese won't want them, they don't like Yasukuni.

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About Me

After graduation, Jun Okumura promptly entered what is now the Ministry of Economy, Trade and Industry and stayed in in its ecosystem most of his “adult” life. Along the way, he had pleasant stops in an assortment of Japanese quangos (Japangos?), overseas assignments and government agencies. After thirty years, though, it dawned on him that he had no aptitude whatsoever for administration and/or management. Armed with this epiphany, he went to the authorities and arranged an amicable separation; to come out, as it were. He is completely on his own IYKWIAS, but he and the METI folks remain “good friends.” He currently holds the titles of “visiting researcher” at the Meiji Institute for Global Affairs (no, that MIGA) and counselor at a risk analysis firm that dares not speak its name. This gives him plenty of time to blog or make money on his own. His bank account says that he does too much of the first, and insists that he do more of what he calls “intellectual odd jobs”. He wants to be paid to write fulltime, or better, talk—where the easy money is—but that distinction has largely escaped him. He really should not be referring to himself in the third person; he is not that famous.